Ask Christa! What are some best practices when working with partners? (S4E41)

Introduction and Listener Question

Hi everyone and welcome to Ask Christa! the place where you can ask questions about how to work through business challenges and workplace issues. I'm Christa Dhimo and today’s listener question is along the lines of episode 37, which focused on improving collaboration in a team—but this is more about working well with OTHER companies. 

The listener question has wonderful context—and when our listeners do that, it reads like a business case, which kinda cool—it’s like being in a quick business school class. Here it is:

“I’ve been an Alliance Manager overseeing various partnerships in a scientific environment for four years, and before that I was a bench scientist. I love people and I love science. I had a lot of fun with great people in the lab, but the work I do as an Alliance Manager feels far more satisfying because of how I can manage scientific relationships outside of my company, while still being connected to my company. I also feel my work more directly impacts the success of my company, which is a different kind of pressure, but I like it. 

I was asked to step into an Alliance Manager role because I had a strong relationship with my company’s largest partner due to the scientific work we do together. A year ago, we brought on another partner and I moved from working in Quality to working in the Market Analytics team in Marketing to put me in with the teams more connected with partners. It was a different vibe, but I learned so much about the commercial side of our business over the last year. I hope they’ve learned from me, too. 

Within the next few months, we’re expecting to close on three new partnerships, which will change a lot of how we work. For starters, we’ve recently re-organized into new and expanded functions. I’ve been promoted to an Associate Director of Alliance Management and will hire and onboard two new Alliance Managers. I’ll also report to a newly hired leader who will head up a new function called Commercial Operations. It includes Customer Service, Alliance Management, and Customer Analytics. It’s a very exciting time. 

The challenge I’m having is two-fold: first, there’s a part of me that isn’t sure if I’m ready for all of this, and second, I’m starting to realize that everything I know is because of how I’ve worked as an Alliance Manager and not because I’m an actual Alliance Manager.

I am working with my manager to help me get through some confidence issues, but what are some best practices to work with partners?”

OK, well… first—congratulations on your promotion and your company’s recent success!  Those who know me know that one of MY favorite things in the world is to be in service to others—hence this show—so I can’t just skim over that first challenge you’re having. I’m REALLY glad you are working with your current manager, because for-sure that person will know you better than I do, but I also want to normalize the feeling that you may not be ready for “all of this,” because the “all” you’re talking about is A LOT.

Big organizational expansion; a LOT of big wins, too; re-organization that brings in new leaders AND new functions—some of which you and others may not know about yet, like how Customer Analytics drives some of the most critical business intelligence in your organization. It sounds to me like you’ve been able to develop into a role that you also helped TO DEVELOP, and you have good humans looking out for you, too. Aside from moving through all the changes (and I’d like to highlight season one episode four as a potential resource for you because it focuses on managing through necessary changes at work), I think the answer to your second challenge, and your question, will probably help you with the confidence piece also.

What IS Alliance Management? 

First, let’s talk about what Alliance Management is. We heard our listener provide the foundational aspects: important partners, managing relationships outside of your company, how partnerships, or alliances, directly impact the success of a company, how the roles are typically within the Commercial organization, either Sales or Marketing or in this new development, a Commercial Operations department. The listener also talked about the amount of expansion that occurs when you bring on new partners.

Those are typically the results of partnerships, and when we talk about Alliances, it’s a term that fully indicates and appreciates HOW closely a partner works with you and HOW involved a partner is to mutual success. This is why I referenced episode 37 also, where we talked about collaborations, because collaborations are about achieving shared goals among team members, and that’s really what an alliance is all about.

So, first, think about an alliance as a critical and really close partnership where mutual success largely results in how well you work together for mutual gains. The core competencies of your organization—or those things you do sooooooo well and so much better than others—complements your partner’s core competencies SO WELL, that you both gain from the… alliance. It’s the quintessential 2+2=5, in that by joining forces, you come up with more than just joining forces or partnering.

Some Best Practices for Alliances (organizational partnerships): Nuts and Bolts

So, to move directly into our listeners question about best practices:

First, as with ALL Ask Christa! episodes, your organization should be clear on what “Alliance Management” means and their objectives, and considering our listener has been in this role for a few years and they seem to be expanding and hiring in a way that signals they understand and are implementing a sound Alliance Management Strategy, our listener probably has objectives in hand. But if not, your organization should be clearly articulating the strategy for alliances and alliance management. It usually includes the process to execute also, and could look like this: our alliance management strategy focuses on increasing our company’s ability to strengthen or improve 1) how we  provide our products or our services to our patients or our customers, 2) how we de-risk our business through a shared-risk model, thereby increasing its value and longevity, and 3) enable faster and higher quality market and service responses so patients or customers receive their products or services in an efficiently, effective way.

Now, that’s not jargon, those are real words. The first strategic goal is to strengthen or improve what you offer to your market, which could be the patients or your customers like health care providers. The second goal talks about how the alliance aims to improve the welfare of your organization short term and long term, and whenever you have a shared risk model, you are doing just that, and the third aim talks about how you’re delivering better things to your market, where efficiency means less waste and effectiveness means higher productivity. Less waste? Maybe you don’t have to build a different lab for just one aspect of your product; maybe your partner has that lab already and they will be doing the testing or manufacturing for that product. More productive? Maybe you don’t have to bog down your current employees with MORE tasks throughout the day for a new product because your partner has its own team to do that work.

So: what are the objectives when deciding on an alliance management strategy, and two make sure you can execute on it. What our listener describes is exactly what I would hope to see: a company restructuring to appropriately re-align resources into areas where employees can refine their focus and concentrate their efforts on the large scope of work. They aren’t keeping an old structure they are outgrowing. They aren’t asking existing employees to take on the work of three people as they sign the contracts with three new partners.

From there, it’s more about the nuts and bolts of vetting and closing on the partnerships, and I liken partnerships that run deep, or… alliance.. to mergers of a sort: you need criteria for finding the right partner, you need knowledge to draft term sheets, you need to do your diligence, negotiate the contract, and close. You also need to have the kind of personality that can effectively and comfortably talk about relationships on paper: expectations for behavior, expectations for meeting and developing and delivering on trust, expectations for communicating and escalating. Expectations for rewards and recognition. You even need to talk about and negotiate how press releases will convey status and how any potential changes or terminations will be managed.

Some Best Practices for Alliances (organizational partnerships): Relationships…

After the strategic elements are soundly in place, or at least underway, the next part is probably what our listener already does soooo well: you have to like working with people, you have to know your contracts in and out—to the detail. You have to want a shared accountability and responsibility for the shared goals while ALSO knowing you each, meaning each organization, has their own goals AND are depending on each other to deliver TO EACH OTHER important goals. After all, how will the shared goals be completed if you aren’t doing your part together and independent from each other.

Alliance management is about working together every day to earn and reinforce trust, respect, and a deep care of success with each other and as separate companies.

I remember managing a critical partnership many many years ago during a turn-around effort for a startup, and my biggest challenge was a board that saw the critical partnership—truly an alliance—as a paid manufacturing and distribution gig. They also felt entitled to have full data on the distribution relationships the partner had, data they often shared but absolutely didn’t have to. It had nothing to do with what the company needed or the lane they were in. 

An alliance will never work if leadership views it as a general contract where the company pays the partner for something and the partner delivers. An alliance runs much deeper than that and is far more critical to the shared success of both parties. And it begins and ends with a relationship.

Additional Resources

For your resources, I invite you to Google best practices for alliance management. You’ll see A LOT there, and I’m highlighting three I reviewed that I think you’ll enjoy:

The first is an oldie-but-goodie from Hughes and Weiss’s 2007 article “Simple rules for making alliances work,” from Harvard Business Review. They list out five principles, and while the way we go about business now might be a bit different from nearly twenty years ago, and we might want to replace one or two principles with more nuanced approaches, the article holds and is an excellent reference for anyone looking to strengthen and improve—or even just learn—about what it takes to do with alliance management.

I also included an article by Jon Lavietes on the Association of Strategic Alliances Professionals called “Strategy Shift: How Alliance Practices—and Alliance Managers—Are Upleveling Their Skills.” It’s from May 2023 and has a lot of real-world examples from a variety of alliance management professionals. It reads as though you’re hearing directly from those involved, and has a lot of quotes, too.

The last is from Project Management Institute, with a disclaimer that I’ve been a member of PMI for over 20 years and a certified PMP® for almost the same amount of time. The article is from Tim Noffke and is also an oldie but goodie, published in 2007, called, “Driving high-performance alliances: pharmaceutical alliance management as a model for best practices.” 

So… why 2007? And why have there been so many science-y topics included in this episode?  

In the 2000s, we saw a lot of deep science and biotech advancements that required a high risk, high capital model to fund such advancements and reach patients. The genome project unlocked a lot of potential, and new science was on the horizon. Various biotechs, including those that may be competitors in one biotech domain, became partners in a different domain. A “go farther together” mentality emerged. Perhaps one of the greatest and most consistent examples of this is Genentech, and I’ll include an article about their history of partnerships in the show notes, too. It’s called “Timeless Partnerships.” 

By the way, we see these alliances in large-scale Department of Defense programs, too, and that’s been around for DECADES, where we see defense contractors like Lockheed Martin, Raytheon, and Northrup Grumman working together toward a shared goal on a single contract even though for all other intents and purposes, they are competitors.

There’s a lot to Alliance Management—and in truth, it’s one of the aspects of my strategy work I have enjoyed the most.

Wrap Up & Submitting Your Questions

And that’s a wrap for EPISODE 41!!! We’re almost halfway through Season 4, focused on listener questions related to Doing the Work!

Submit your question on my show’s site, AskChrista.com, that’s Christa with a C-H, where you will see all my episodes listed based on category and season. While your there—sign up for my More Answers… newsletter, where you will receive additional content on Sunday nights to set you up for the work week.

As always—thank you for your support. And remember, if you have a business challenge or a workplace issue—Ask Christa!